Fochtman v. Rhino Energy, LLC et al
Filing
12
MEMORANDUM OPINION AND ORDER: (1) Fochtman's motion to remand this case to state court, R. 3 , is GRANTED. This case is REMANDED to Pike County Circuit Court and STRICKEN from Court's active docket. (2) Fochtman' ;s motion for costs, R. 3 , is GRANTED. By Friday, November 15, 2013, Fochtman shall FILE a statement cataloguing his costs and expenses, including attorney's fees, incurred as a result of removal. (3) The telephone conference scheduled for October 18, 2013, R. 6 , is VACATED. Signed by Judge Amul R. Thapar on 10/17/2013. (RCB)cc: COR, Pike Circuit Court-certified copy w/docket sheet
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF KENTUCKY
SOUTHERN DIVISION
PIKEVILLE
STEPHEN M. FOCHTMAN,
Plaintiff,
v.
RHINO ENERGY, LLC, et al.,
Defendants.
)
)
)
)
)
)
)
)
)
)
Civil No. 13-104-ART
MEMORANDUM OPINION
AND ORDER
*** *** *** ***
After five years litigating this case in state court, defendants CAM Mining LLC and
Rhino Energy LLC (“CAM and Rhino Energy”) removed this case to federal court, citing the
plaintiff’s supposedly recent revelation of a new basis for federal-question jurisdiction
pursuant to 28 U.S.C. § 1331. R. 1 at 1 (citing 28 U.S.C. § 1441(a) and (c) as authorizing
removal of this matter). Plaintiff Stephen Fochtman promptly moved to remand under 27
U.S.C. § 1447, alleging that CAM and Rhino Energy had removed the case to avoid or delay
an impending trial in state court. R. 3-1 at 2. In support of his motion, Fochtman argued that
(1) removal was untimely pursuant to 28 U.S.C. § 1446(b); (2) CAM and Rhino Energy had
waived their right to removal; and (3) his causes of action did not arise under federal law or
implicate a substantial federal question, so CAM and Rhino Energy had no grounds for
removal.1
1
Id. at 4.
Because the Court lacks federal-question jurisdiction to consider
In December 2011, Congress substantially amended the portions of the United States Code governing
removal and remand. See Federal Courts Jurisdiction and Venue Clarification Act of 2011 (“FCJVCA”), Pub.
L. No. 112-63, 125 Stat. 758 (2011). The revisions, however, apply only to actions commenced after the
amendments’ effective date of January 6, 2012. § 105, 125 Stat. at 762. This case commenced within the
meaning of Kentucky law on June 5, 2008. R. 1-10 at 1–7; see Ky. R. Civ. P. 3.01 (“A civil action is
commenced by the filing of a complaint with the court and the issuance of a summons or warning order
thereon in good faith.”). Accordingly, any citations to the United States Code in this order refer to the preamendment version of the removal provisions.
Fochtman’s claims, removal is improper, and the Court must remand this case to the state
court.
I.
The Court Lacks Federal-Question Jurisdiction in This Case.
CAM and Rhino Energy would be entitled to remove this case if Fochtman “could
have brought it in federal district court originally . . . as a civil action arising under the
Constitution, laws or treaties of the United States.” Grable & Sons Metal Prods., Inc. v.
Darue Eng’g & Mfg., 545 U.S. 308, 312 (2005) (citing 28 U.S.C. §§ 1331, 1441(a)) (internal
quotation marks and citations omitted). In most cases, plaintiffs invoke federal-question
jurisdiction by pleading a cause of action created by federal law. Id. However, in limited
instances, federal-question jurisdiction embraces state-law claims that implicate significant
federal issues. Id. To determine whether federal-question jurisdiction is appropriate in such
cases, the Court must inquire whether the relevant federal issue is: (1) necessarily raised, (2)
actually disputed, (3) substantial, and (4) capable of resolution without disrupting the federalstate balance approved by Congress.
Gunn v. Minton, 133 S. Ct. 1059, 1065 (2013)
(clarifying Grable, 545 U.S. at 314).
According to CAM and Rhino Energy, this is one of the rare cases in which a statelaw cause of action merits federal-question jurisdiction. CAM and Rhino Energy argue that
the Court has original jurisdiction over this case because Fochtman’s negligence per se claim
against the defendants hinges on their alleged violation of the Federal Motor Carrier Safety
Regulations (“FMCSR”). R. 1 at 4. However, application of Grable and Gunn’s four-part
test to the circumstances of this case makes clear that federal jurisdiction does not lie over
Fochtman’s state-law claim.
Two factors support CAM and Rhino Energy’s position in favor of removability.
First, resolution of a federal question is “necessary” to Fochtman’s case. In his second
2
amended complaint, Fochtman alleges violations of certain Kentucky statutory and
regulatory provisions that incorporate federal law, including one regulation specifically
adopting the FMCSR. R. 1-7 at 9 (citing 601 Ky. Admin. Regs. 1:005); see R. 1 at 5–6; R.
3-1 at 8–9. As CAM and Rhino Energy point out, Fochtman exclusively employed federal
law to interpret the Kentucky regulations cited in his second amended complaint in a related
motion for summary judgment. R. 1 at 7–8. Thus, the argument goes, applying Kentucky
law in this case necessarily requires interpretation of federal law.
Second, the parties
“actually dispute[]” the federal issue here. CAM and Rhino Energy strenuously disagree
with Fochtman’s view of their liability under 601 Ky. Admin. Regs. 1:005, based on their
differing interpretations of the FMCSR. Id. at 8.
But the remaining factors prevent removal in this case. The federal issue at stake
does not qualify as “substantial,” because it lacks importance to the federal system as a
whole. Gunn, 133 S. Ct. at 1066. In other words, the resolution of this “fact-bound and
situation-specific” federal issue would not necessarily dispose of this case or determine the
outcome of other cases. Empire Healthchoice Assur., Inc. v. McVeigh, 547 U.S. 677, 701
(2006). Moreover, Fochtman brought a garden-variety state tort claim. See Hampton v. R.J.
Corman Ry. Switching Co., 683 F.3d 708, 712 (6th Cir. 2012). The Supreme Court has
previously indicated that a claimed violation of a federal statute as an element of a run-ofthe-mill state negligence cause of action is “insufficiently substantial to confer federalquestion jurisdiction.” Id. (citing Merrell Dow Pharms. Inc. v. Thompson, 478 U.S. 804, 814
(1986) (internal quotation marks omitted)).
Finally, permitting state courts to interpret the FMCSR would not disrupt the
accommodation between federal and state interests endorsed by Congress. Congress has not,
for example, created a private right of action for relief under the FMCSR or its underlying
3
statute. See Schramm v. Foster, 341 F. Supp. 2d 536, 547 (D. Md. 2004) (collecting cases);
see generally Jennifer Mullenbach, Third Party Logistics and Legal Liability for Personal
Injuries: Where Does the Injured Motorists’ Road to Recovery Lead?, 33 Transp. L.J. 145
(2005). Of course, the absence of a federal private right of action does not entirely decide
the issue of congressional intent. Grable, 545 U.S. at 317–18. Still, it is persuasive evidence
that Congress did not intend to set out a “welcome mat” inviting state claims with embedded
federal issues like this one into federal court. Id. at 318; see Merrell Dow, 478 U.S. at 810–
12. Given the absence of a substantial federal interest in this case and the state’s strong
interest in developing its own personal injury doctrine without interference by federal courts,
the Court presumes that state-court interpretation of the FMCSR would not upset Congress’s
balance of considerations.
For these reasons, the pendulum swings in favor of remand. Thus, the Court need not
consider Fochtman’s alternative argument concerning CAM and Rhino Energy’s alleged
waiver of their right to removal.
II.
CAM and Rhino Energy Untimely Removed This Case.
That leaves Fochtman’s final objection: the alleged untimeliness of CAM and Rhino
Energy’s removal of this case. Where, as here, the Court obviously lacks federal-question
jurisdiction over a case, no additional grounds for remand are required. Still, even if CAM
and Rhino Energy were entitled to removal, their removal came too late.
When a case is not initially removable, a defendant has thirty days to file his notice of
removal after he receives an amended pleading, motion, order, or other paper that signals that
the case has since become removable. 28 U.S.C. § 1446(b). Federal courts strictly construe
this timeline. See Brierly v. Alusuisse Flexible Packaging, Inc., 184 F.3d 527, 534 (6th Cir.
1999). The thirty-day period for removal begins as soon as a defendant has “solid and
4
unambiguous information that the case is removable.” Walker v. Philip Morris USA, Inc.,
443 F. App’x 946, 950 (6th Cir. 2011). Unless the party opposing removal has waived
untimeliness as a ground for remand, failure to comply with this statutory deadline results in
remand of the case to state court. See Seaton v. Jabe, 992 F.2d 79, 81 (6th Cir. 1993).
To explain their removal of this case on the eve of trial, after five years of litigation in
state court, CAM and Rhino Energy allege that they only uncovered the supposed federal
question lurking in this case in August and September 2013. R. 1 at 3–7. That is indeed
when Fochtman stated his negligence per se claim based on CAM and Rhino Energy’s
violation of the FMCSR for the first time. Id. But, CAM and Rhino Energy already knew by
2009 that Fochtman had a state-law claim related to the FMCSR against one of their codefendants, Randall Bartley. R. 1 at 2. In both his amended complaint and his response to a
motion for summary judgment filed by CAM and Rhino Energy, Fochtman alleged that
Bartley had violated the FMCSR. See R. 1-2 at 5; R. 3-1 at 12.
Now, assume for the sake of argument that the presence of a FMCSR-based state law
claim renders a case removable.2 On that assumption, this case became removable with the
filing of Fochtman’s first amended complaint in 2009 due to his FMCSR-based claim against
Bartley. See 28 U.S.C. § 1441(c) (permitting the removal of an entire case containing both
removable and non-removable claims). That amended complaint was the first “amended
pleading . . . from which it may first be ascertained that the case is one which . . . has become
removable,” so it set the thirty-day removal clock in motion. § 1446(b). And, since the right
to remove a case is joint rather than individual, the clock was ticking in 2009 for all four
defendants—even CAM and Rhino Energy. See Esposito v. Home Depot U.S.A., Inc., 590
F.3d 72, 75 (1st Cir. 2009). In other words, it is irrelevant which defendant the plaintiff
originally brought the claim against.
2
If a “case” involves a federal claim against any
The Court has, of course, already rejected this assumption. See supra, Part I.
5
defendant, that case is removable so long as all the defendants agree to removal. Thus, the
case became removable in 2009, not 2013. As such, CAM and Rhino Energy missed their §
1446(b) deadline for removal by a mile. The only reasonable explanation for their delay is
the one proposed by Fochtman: they improperly sought removal to delay trial in state court.
R. 3-1 at 2.
III.
Fochtman Is Entitled to Costs and Actual Expenses, Including Attorney’s Fees.
Having prevailed on his motion to remand, Fochtman next requests that the Court
grant him costs and reasonable attorney fees to sanction CAM and Rhino Energy for
belatedly seeking removal. R. 3-1 at 16. Pursuant to 28 U.S.C. § 1447(c), the Court may
require payment of just costs and any actual expenses, including attorney’s fees, incurred as
the result of removal. Normally, “absent unusual circumstances, attorney’s fees should not
be awarded when the removing party has an objectively reasonable basis for removal.”
Martin v. Franklin Capital Corp., 546 U.S. 132, 136 (2005). In this case, while Supreme
Court and Sixth Circuit precedent made successful removal an extremely unlikely
proposition, the Court cannot say that CAM and Rhino Energy’s basis for removing would
have been objectively unreasonable four years ago. And maybe had they done it then, costs
would not have been warranted. However, where the timing of the removal indicates that the
real reason for removal is delay and disruption, costs are justified. See Martin, 546 U.S. at
140 (recognizing “the desire to deter removals sought for the purpose of prolonging
litigation”). That is precisely what occurred here. The defendants removed the case four
years after it arguably became removable and on the door step of trial. That is disruptive to
the state court, disruptive to the litigation, and disruptive to the parties’ lives. If anything
merits rewarding costs, a removal such as this surely does. The Court will therefore award
Fochtman costs and reasonable expenses incurred as the result of removal.
6
Accordingly, it is ORDERED that:
(1)
Fochtman’s motion to remand this case to state court, R. 3, is GRANTED.
This case is REMANDED to the Pike County Circuit Court and STRICKEN
from the Court’s active docket.
(2)
Fochtman’s motion for costs, R. 3, is GRANTED. By Friday, November 15,
2013, Fochtman shall FILE a statement cataloguing his costs and expenses,
including attorney’s fees, incurred as a result of removal.
(3)
The telephone conference scheduled for October 18, 2013, R. 6, is
VACATED.
This the 17th day of October, 2013.
7
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?